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Before two of its alleged members were arrested and charged in Australia last month, the hacker group known as TeamPCP carried out a hacking spree unlike any other in history. It tainted hundreds of open-source programs with its malware, stole developer accounts to perpetuate that software supply-chain hacking, and even released a Dune-themed self-spreading worm to automate the process, ultimately breaching more than a thousand companies.

Now Google’s threat intelligence group has revealed that during a key moment of TeamPCP’s rampage, the company’s own undercover researcher had infiltrated the group—allowing Google to monitor the hacking spree from the inside, warn breach targets, and even help disrupt the group’s attempts to exploit those victims.

In a talk at security firm SentinelOne's LABScon research conference today, Google Threat Intelligence Group researcher Austin Larsen will present details on the company’s investigation—and infiltration—of TeamPCP amidst the group’s unprecedented, chaotic supply-chain hacking campaign. According to Larsen, Google eventually followed a trail of operational security mistakes allegedly made by one of the two Australians now accused of being leading members of the hacker group and passed on key identifying details to law enforcement. The company also received intelligence from ShinyHunters, another infamous cybercriminal group that TeamPCP partnered with, but which later turned on the supply-chain hackers. And perhaps most surprisingly, Larsen says that Google’s security subsidiary Mandiant had an undercover analyst—not himself—within the group’s inner circle from almost the beginning of TeamPCP’s time in the spotlight.

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When it comes to AI models, security functions as an afterthought, as evidenced by increased instances of agents hacking organizations and people, and other security mishaps with agents gone rogue. There's also an opportunity here for companies to offer new solutions. This should not come as a shock to anyone, according to cybersecurity investors and accelerator executives. “On one hand, we shouldn’t be surprised that increasingly capable agents are finding creative and sometimes unexpected ways to accomplish their objectives,” Matt Hartman, chief strategy officer at Merlin Group, told The Register. “On the other, we can’t accept harmful behavior as inevitable or unmanageable.” It’s the same story that plays out with every emerging technology, from laptops to cloud, said Todd Graham, managing partner at Microsoft’s M12 venture fund. “Every time we've built a new piece of infrastructure, we've conveniently forgotten the security,” Graham told The Register. Herein lies the opportunity for early-stage security companies. “If laptops were default secure, we wouldn't have CrowdStrike,” Graham said. “If the cloud was default secure, we wouldn't have Wiz. If identity wasn't default secure, we wouldn't have a bunch of Active Directory add-ons and Okta.” When it comes to AI security, “a lot of ships are going to rise with this tide,” he added. What’s different with AI is the speed at which models are advancing. While companies adopted cloud technologies over a period of years, organizations are moving full speed ahead to incorporate agents and other AI tools into their production environments and allow them to access the most business-critical data and applications. Yet they don’t have a strong handle on how to manage, secure, or even identify the agents that are already roving about their systems. “This is a transition happening month over month, and given the rate of change we’re seeing in the market, I’m in no way or shape surprised that this issue has come to a head in a rather dramatic fashion,” Graham said. “The incidents that have occurred - I’m not going to defend them, but they should be a wake up call. This is a moment in time where we need to insert security, and we're just going to have to insert it faster.” 'Ships are going to rise' with the AI tide Hartman joined Merlin after a lengthy career in federal cybersecurity, including senior roles at the US Cybersecurity and Infrastructure Security Agency. In his private-sector role, he helps determine which early- to growth-stage cybersecurity companies the group invests in, and then works with these firms to scale their technology across government, critical infrastructure, and other highly regulated markets. “We’re particularly interested in the security layer that governs agent behavior: identity for non-human actors, clear limits on what they can access and do, and an audit trail for actions taken on an agency’s behalf,” he said. “Agencies aren’t just asking how to adopt agents, they’re asking how to constrain them and prove what one did at 2 AM on a Tuesday.” But while “the opportunity is enormous,” startup founders need to do more than just build an agentic AI security product. “AI has made it faster and cheaper than ever to build a product, so the bar for differentiation keeps rising,” Hartman said. “As the cost of building technology falls, the value shifts toward differentiated capabilities and the ability to take them to market. Founders who can do both have a real opportunity to define this category.” Graham also says that end-users are looking for agentic identity and governance products - “I truly believe someone is going to build the next Okta, just as SaaS generated Okta,” - but adds he sees several founders “thinking way too small.” “I’m seeing a lot of companies that are solving a sliver of the problem,” Graham said. “And the reality is, if I'm a CISO for a Fortune 500 company, no way I'm going to go buy 15 things to do one thing. If you look at the standard identity stack that we’ve had for humans for quite some time, it has governance, you know, access control, authorization, access. For agents, someone's going to have to come to us with a solution that does all of the things.” Agentic identity is the next unicorn When it comes to non-human identities, however, that’s a really big, tough ask. Service accounts remain a prime target for hackers because they typically have high privileges and passwords that never expire. Securing these non-human accounts still plagues security teams - and that’s even before agents entered the mix. Beyond agentic identity, AI endpoint security - think of this as CrowdStrike for AI - is another area ripe for inventive startups, Graham said. 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Still, he’s “comforted” because he’s seen this scenario play out before, with security scrambling to keep up with infrastructure development. Graham also was "pleasantly surprised” by Anthropic CEO Dario Amodei’s now infamous “We Must Pace the Frontier” essay. “I'm not taking the cynical view that it's some sort of grand conspiracy to get around antitrust,” he told us. “I'm a believer that AI is this awesome tool that is going to fundamentally change a lot of lives for the better. But we’ve got to put in the work now,” Graham said. “We've kicked the security can down the road long enough, and now we need to solve it.” ®

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